JYOTI TANDON,HALDWANI vs. ITO WARD 2(1)(1), HALDWANI

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ITA 268/DDN/2026Status: DisposedITAT Dehradun28 July 2026AY 2016-173 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that for F&O transactions settled otherwise than by actual delivery, the turnover should be considered only with respect to the profit or loss, not the gross sales and purchases. Since the assessee's actual loss was within the threshold, Section 44AB was not applicable.

What were the facts?

The assessee was levied a penalty under Section 271B for failure to get books of accounts audited under Section 44AB. The Assessing Officer considered the total turnover of F&O transactions, including intraday trades settled otherwise than by actual delivery.

What were the issues?

Whether the turnover for F&O transactions settled otherwise than by actual delivery should be considered as gross sales/purchases or profit/loss for the purpose of Section 44AB, and consequently, the applicability of penalty under Section 271B.

Which sections of the Income-tax Act were involved?

Section 271B,Section 44AB

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DEHRADUN BENCH, DEHRADUN

Before: Shri Mahavir Singh & Shri Sanjay Awasthi

Hearing: 20.07.2026Pronounced: 28.07.2026

IN THE INCOME TAX APPELLATE TRIBUNAL DEHRADUN BENCH, DEHRADUN Before Shri Mahavir Singh, Vice President & Shri Sanjay Awasthi, Accountant Member ITA No. 268/DDN/2026 : Asstt. Year : 2016-17 Jyoti Tandon, Vs Income Tax Officer, Ramashram Wali Gali, Mallah Ward-2(1)(1), Gorakhpur, Haldwani, Nainital, Haldwani, Daladhungi Road, Uttarakhand-263139 Uttarakhand-263139 (APPELLANT) (RESPONDENT) PAN No. AKFPT4284Q Assessee by: None Revenue by: Sh. Deepak Chaudhary, JCIT Date of Hearing: 20.07.2026 Date of Pronouncement: 28.07.2026

ORDER Per Bench: This appeal by assessee is arising out of the order of ld. CIT(A)/NFAC, Delhi in DIN & order No. ITBA/NFAC/S/250/2025- 26/1078662297(1), order dated 18.07.2025. Assessment was completed u/s 143(3) of the Income Tax Act, 1961 (hereinafter “the Act”) by the AO of NFAC vide Assessment Year 2016-17, order dated 07.12.2018. The penalty under dispute was levied by the AO, NFAC, Delhi u/s 271B of the Act vide order dated 13.09.2021.

2.

The only issue in this appeal of assessee is in regard to the order of the ld. CIT(A) confirming the levy of penalty

2 ITA No. 268/DDN/2026 Jyoti Tandon u/s271B of the Act by the AO for alleged failure to get its books of accounts audited u/s 44AB of the Act without appreciating the fact that the turnover of the assessee was not exceeding the turnover limit as specified u/s 44AB of the Act for the relevant financial year, relevant to Assessment Year 2016-17.

3.

We have heard ld. Sr. DR and gone through the facts and circumstances of the case. Admittedly, the assessee is engaged in F&O i.e. sale of shares or units as reported in Securities Transaction Tax Return, which is settled otherwise than by actual delivery of transfer. The AO in his penalty order noted that the assessee has incurred a loss of intraday stock trading of Rs.2,00,724/-, on a turnover of Rs.25,84,23,237/-.

4.

The Assessing Officer levied the penalty without verifying legal position that assessee’s turnover in F&O is to be considered only with respect to either loss or profit and not the sales & purchases made intraday, which are settled otherwise than by actual delivery of transfer. The actual loss incurred intraday stock trading by assessee is Rs.2,00,724/-. It means that there is a turnover of Rs.2,00,724/- only and not Rs.25,84,23,237/-. Once this position is understood then the assessee’s case is not at all covered u/s 44AB of the Act and hence there is no failure to get the accounts audited. There is

3 ITA No. 268/DDN/2026 Jyoti Tandon no requirement in the case of the assessee to do so. Once this is settled as a position of fact, then the penalty u/s 271B of the Act cannot be levied. Accordingly, the penalty is deleted.

5.

In the result, appeal of the assessee is allowed. Order Pronounced in the Open Court on 28/07/2026. Sd/- Sd/- (Sanjay Awasthi) (Mahavir Singh) Accountant Member Vice President Dated: 28/07/2026 *Subodh Kumar, Sr. PS* Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR

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